Wheat - the BIG supply picture
A comment in a report for last night's CME wheat close ("We're going to be swimming in wheat next year") got me thinking this morning. So I decided to do a bit of research into some firm numbers on world wheat production for the coming year.
In the UK wheat production could rise 20 percent this year assuming a return to average yields with the planted area set to climb 13 percent, according to analyst Susan Twining of ADAS. "Yields were down last year and even if you work on average yields of 7.8 tonnes per hectare that takes production above 16 million tonnes which is a 20 percent increase," Twining added. Britain's farm ministry has put 2007's UK wheat crop at 13.36 million tonnes, down from 14.74 million lain 2006 with average yields at 7.3 tonnes versus 8.0 tonnes in 2006. Twining said the rise in wheat area reflected the suspension of set-aside, the woes of Britain's livestock sector and high prices for the commodity.
In Europe as a whole Strategie Grains is forecasting that European Union (EU) 27 wheat production will skyrocket from 2007’s 111.5 million tonnes to 128.6 million tonnes in 2008 (a 15% increase). They see wheat area expanding in the EU 27 by 4% and yields going up 11% in 2008.
Ukrainian wheat production this year is expected 30% higher and wheat area 40% larger than last year. This would put production in the 17.5 to 18. 5 million tonne range, around 4-5mmt up on 2007-08.
SovEcon estimates that this year’s Russian wheat crop will come in at 31.4 million tonnes. That is well above the 2002-06 average of 24.8 million tonnes.
As we all know the USDA release their US acreage estimates on Monday. Meanwhile, Informa Economics is forecasting that US wheat acres will climb to 63.526 million acres next crop year from this crop year’s 60.433 million acres. That is a 3.093 million acre (5.1%) increase. Using 2007's average yield of 40.5 bu/acre that gives us approximately 125m bushels more in 2008, or 3.4 million tonnes.
The Canadian Wheat Board sees the Canadian wheat crop coming off at 28.8 million tonnes, an increase of 8.7mmt (or around 44%) from 2007-08's 20.1mmt.
In their February forecast, ABARE increased their estimate of last season's 2007-08 Aussie wheat crop by 400,000 tonnes to 13.1 million tonnes. ABARE sees the Aussies harvesting almost 26 million tonnes of wheat in 2008, an increase of nearly 13mmt, some analysts are forecasting production even higher at a record 27mmt, IF of course mother nature conforms. That would give us an increase of 13-14mmt.
The International Grains Council is forecasting world wheat production to climb 42.6 million tonnes (about 7%) next crop year to 646.2 million tonnes. Informa Economics thinks that the 2008-09 number will be 650 million tonnes.
In the UK wheat production could rise 20 percent this year assuming a return to average yields with the planted area set to climb 13 percent, according to analyst Susan Twining of ADAS. "Yields were down last year and even if you work on average yields of 7.8 tonnes per hectare that takes production above 16 million tonnes which is a 20 percent increase," Twining added. Britain's farm ministry has put 2007's UK wheat crop at 13.36 million tonnes, down from 14.74 million lain 2006 with average yields at 7.3 tonnes versus 8.0 tonnes in 2006. Twining said the rise in wheat area reflected the suspension of set-aside, the woes of Britain's livestock sector and high prices for the commodity.
In Europe as a whole Strategie Grains is forecasting that European Union (EU) 27 wheat production will skyrocket from 2007’s 111.5 million tonnes to 128.6 million tonnes in 2008 (a 15% increase). They see wheat area expanding in the EU 27 by 4% and yields going up 11% in 2008.
Ukrainian wheat production this year is expected 30% higher and wheat area 40% larger than last year. This would put production in the 17.5 to 18. 5 million tonne range, around 4-5mmt up on 2007-08.
SovEcon estimates that this year’s Russian wheat crop will come in at 31.4 million tonnes. That is well above the 2002-06 average of 24.8 million tonnes.
As we all know the USDA release their US acreage estimates on Monday. Meanwhile, Informa Economics is forecasting that US wheat acres will climb to 63.526 million acres next crop year from this crop year’s 60.433 million acres. That is a 3.093 million acre (5.1%) increase. Using 2007's average yield of 40.5 bu/acre that gives us approximately 125m bushels more in 2008, or 3.4 million tonnes.
The Canadian Wheat Board sees the Canadian wheat crop coming off at 28.8 million tonnes, an increase of 8.7mmt (or around 44%) from 2007-08's 20.1mmt.
In their February forecast, ABARE increased their estimate of last season's 2007-08 Aussie wheat crop by 400,000 tonnes to 13.1 million tonnes. ABARE sees the Aussies harvesting almost 26 million tonnes of wheat in 2008, an increase of nearly 13mmt, some analysts are forecasting production even higher at a record 27mmt, IF of course mother nature conforms. That would give us an increase of 13-14mmt.
The International Grains Council is forecasting world wheat production to climb 42.6 million tonnes (about 7%) next crop year to 646.2 million tonnes. Informa Economics thinks that the 2008-09 number will be 650 million tonnes.